Egypt accelerates USD 128 mn downstream grid expansion targeting early 2027

Egypt is accelerating a USD 128 mn, six-pipeline infrastructure package spanning 317 km to transport crude oil and petroleum products between domestic production zones, refineries, and export terminals across the country, according to an unnamed government official. The full network is slated to come online by early 2027.

The missing link on the Mediterranean: The biggest piece of the package is the USD 52 mn, 135-km pipeline connecting the Midor refinery in Alexandria to the Al Hamra petroleum port in El Alamein, due in November. As we noted back in May, this line is the missing link on the Mediterranean coast. It closes a two-way loop that allows Egypt to import crude, refine it domestically at Midor, and pump the higher-value finished products back to Al Hamra for re-export.

The rest of the pipelines include:

• A USD 21 mn, 52 km pipeline from Khorshid (east of Alexandria) to Damanhur launching this month;
• Phase one of the Tebbin-Assiut line, spanning 75 km and launching by year-end at a cost of USD 13 mn;
• A USD 31 mn, 16-km line serving the Assiut Oil Refining Company, coming online in December;
• Two smaller mazut lines around Cairo: a USD 6 mn, 20-km line from Mostorod to west Shubra, due in early 2027, and a USD 4.2 mn, 19-km route realignment between Mostorod and Tebbin.

The big picture: Egypt’s petroleum exports are surging. In 1H 2026 alone, the country exported 2.3 mn tons of petroleum products, generating USD 2.3 bn in revenue, matching its entire export volume for 2025 in just six months. The government expects to ship out an even higher 2.5 mn tons in the second half of the year.

Refineries are busier than ever: This boom is happening because local refineries are now operating at 80% capacity, up from 60% previously, driven by an increase in crude supply and domestic crude production hitting a two-year high. This pipeline expansion goes hand-in-hand with a broader USD 4.5 bn state program to upgrade our existing refineries, boost local fuel production, and shrink the country’s import bill.

In other energy news

Shell and the Egyptian Natural Gas Holding Company (Egas) are aiming to bring the deepwater Khufu gas field online in 2H 2027 with an initial output of 45 mmcf / d, according to an unnamed government official.

About the field: The field, located in the Mediterranean’s North East El Amriya concession, will bypass a lengthy development cycle by directly connecting to existing production facilities in West Burullus by the end of 2027. Rashid Petroleum (Rashpetco) is executing the development on behalf of the partners. Shell operates the concession with a 60% interest, while Kuwait Foreign Petroleum Exploration Company (KUFPEC) holds the remaining 40%.

The downgrade: Khufu’s reserves are now estimated at less than 500 bcf. This is much lower than the initial estimates announced in May 2024, when Khufu and its sister field West Mina were believed to hold a combined 2 tcf of reserves. Meanwhile, preliminary estimates for West Mina have come in at a meager 245 bcf, meaning the two fields hold less than 750 bcf.

West Mina is still the heavy hitter: Shell expects to bring West Mina online by the end of 2026, adding around 160 mmcf / d to the country’s output.